Macro

Seabridge Gold's Stock Soars, Eyes Massive BC Gold-Copper Venture

Seabridge Gold's stock rebounds amid rising gold prices, focusing on securing a partner for its massive BC gold-copper project.

By Bill Bullington

5/16, 13:04 EDT
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Key Takeaway

  • Seabridge Gold Inc. sees significant stock price increase from CA$12.75 to CA$23, buoyed by rising gold and copper prices.
  • The company's KSM project in BC, the largest undeveloped gold and copper project globally, is a key focus for 2024 with efforts to find a joint venture partner.
  • Q1 financials show a net loss of CA$8.2 million; management and insiders own ~3% of the company, with institutional ownership at about 55%.

Seabridge Gold's Strategic Moves

Seabridge Gold Inc. has been making significant strides in the gold and copper markets, with its stock price witnessing a notable recovery from a six-month low of CA$12.75 per share to a high of CA$23 on April 12, settling at CA$20.86 per share recently. This resurgence is largely attributed to the rising prices of gold and copper, with gold increasing more than 15% this year and hitting US$2,362.49 per ounce recently. The company's efforts to secure a partner for its KSM project in British Columbia, touted as the largest undeveloped gold and copper project globally, are seen as a pivotal move for its future growth.

Gold's Unprecedented Rally

Rudi Fronk, Seabridge's Chairman and CEO, has observed a unique trend in the gold market this year, where despite a strong dollar, gold is moving from the West to the East, with nations increasing their gold reserves. Central banks have become the biggest buyers of gold, signaling a shift towards gold replacing dollar-denominated assets in central bank reserves. Fronk anticipates gold prices reaching levels that could surprise many, highlighting Seabridge as an attractive investment opportunity given its significant gold, copper, silver, and molybdenum reserves.

Exploration and Financial Goals for 2024

Seabridge is not only focused on finding a joint venture partner for the KSM project but is also committed to expanding its resource base at the Iskut and 3 Aces projects. The company plans a 15,000-meter core drilling campaign at Iskut with a budget of CA$12 million. Financially, Seabridge reported a net loss of CA$8.2 million for the quarter ending March 31, compared to a net loss of CA$10.8 million for the same period last year, with CA$39.3 million invested in mineral interest project spending.

Street Views

  • Mike Kozak, Cantor Fitzgerald (Bullish on Seabridge Gold):

    "Offers among the highest torque to underlying gold prices."

  • Taylor Combaluzier, Red Cloud Securities (Bullish on Seabridge Gold's KSM project):

    "One of the largest, undeveloped gold-copper projects in the world."

  • Lucas N. Pipes, B. Riley Securities (Bullish on Seabridge Gold):

    "Seabridge has a clear vision for a potential partnership agreement" for the project.

  • Chris Temple, The National Investor (Bullish on Seabridge Gold):

    "Even some 'experts' in the precious metals space are WAY behind in their understanding of just what kind of world-class monster Seabridge's flagship KSM Project in British Columbia's Golden Triangle has become."

Management Quotes

  • Rudi Fronk, CEO and Chairman of Seabridge Gold:

    "We're starting to see the benefit of higher gold prices and our share price should also be reacting to copper prices... A successful KSM joint venture clearly will be the biggest driver of value for us going forward. And we're diligently working on trying to get the joint venture done with the right partner under the right terms."

    "And here sits KSM, the largest undeveloped gold and copper project in the world, as measured by reserves and resources in a safe jurisdiction with permits in hand and support of local indigenous peoples... So, KSM checks a lot of boxes."

    "If you play numbers and just look at all metal we have in ground in terms of resources (such as) gold,copper,silver,and molly(molybdenum),and take today’s metal prices for those four metals,and take our shares outstanding each one our shares is backed by over $6 thousand dollars metal ground per share."